The country’s poorest families could miss out on their £150 council tax refund

Some of the country’s poorest households are at risk of missing out on a scheme designed to protect them as the UK’s cost of living crisis deepens. Last February, the UK government announced that around 20 million households in municipal tax bands A to D – including 95% of let properties – would benefit from a £150 council tax refund.

But a living standards think tank fears some of the country’s most vulnerable households could fall through the cracks and miss out on the government’s £3billion scheme. The Resolution Foundation, an independent think tank focused on improving the living standards of people on low to middle incomes, has acknowledged that the government’s energy rebate scheme will go some way to reducing the impact of the rise in the energy price cap on low-income households. .

But the Foundation warns that the support does not go far enough to protect low-income households from rising energy bills, while the design of the program is “deeply flawed”. Consequently, the number of households in “energy stress” (devoting at least 10% of their total budget to energy bills) is expected to double again overnight, from 2.5 to 5 million households.

And with the price cap set to rise again on October 1, the number of energy-stressed families will continue to rise sharply unless additional support is provided.

The think tank is concerned that the scheme may not be the most effective way to target aid to low-income households. 11% of the poorest fifth of households are not eligible for the rebate because they live in properties in the EH band, while 59% of the richest fifth are eligible. Poor households in London, where a fifth of the poorest households in five live in properties in the EH strip and are therefore not eligible for automatic support, are most likely to miss out, the Resolution Foundation said.

He also raised concerns that the council tax system does not guarantee that the refund will go to those paying higher energy bills, with many landlords paying their tenants council tax without obligation. to pass on the refund, leaving their tenants to pay the highest price. invoices.

Jonathan Marshall, senior economist at the Resolution Foundation, said: “Friday’s energy price cap hike will see the number of energy-stressed households double to five million. While the price cap is expected to rise sharply again on October 1, an additional 2.5 million households could fall into fuel crisis this fall unless additional support is provided.

“There is no easy way to protect people from rising bills in the current climate. But as many of the poorest households do not benefit from council tax reimbursement, this scheme should be used to complement, rather than replace, support through the benefit system, which is better equipped to target families low income.

“A further rise in energy bills this fall accentuates the need for more immediate support, as well as a clear, long-term strategy to improve home insulation, increase renewable and nuclear electricity production and reform energy markets so that family energy bills are less dependent on global gas prices.

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